We should've just dropped the bomb on Germany back in 1945. This is pitiful,
those morons don't know how to run a company. :(
-Ryan
99 DA RC R/T
*SIGH*
----- Original Message -----
From: "Steven St.Laurent" <saint1958@home.com>
To: <dakota-truck@buffnet.net>
Sent: Tuesday, January 23, 2001 3:17 AM
Subject: DML: The Panic At DaimlerChrysler
> Jerry Flint, Forbes.com, 01.19.01, 12:01 AM ET
>
> Chrysler has problems: a $500 million loss in the third quarter of last
> year, maybe $1 billion in the fourth quarter. U.S. operations are not
> pouring money into the bank at Stuttgart, the headquarters of
> DaimlerChrysler, and the Germans need all the money they can get to help
pay
> for their acquisition spree.
>
> So it's panic time in Stuttgart. The Germans seem to think they must burn
> down Chrysler (nyse: DCX) in order to save it.
>
> The German plans:
>
> 1.Chopping planned new Chrysler models.
>
> 2.Ordering--not asking--suppliers to cut prices 5%.
>
> 3.Getting rid of thousands of Chrysler white-collar employees.
>
> 4.Combining some product development and production with Mitsubishi of
> Japan, in which DaimlerChrysler holds a controlling stake.
>
> 5.Using parts or production techniques from Mercedes itself.
>
> Chrysler's German masters think that all these actions will save billions
of
> dollars. The final solution is supposed to be ready at the end of
February,
> but I have serious problems with these ideas.
>
> Let me start with new product plans. Chrysler has lived and prospered by
> bringing out innovative and exciting vehicles--from the first minivan to
the
> PT Cruiser. In a market that is increasingly driven by imaginative,
stylish
> products Chrysler can ill afford to stifle its product pipeline. Call me
> paranoid, but I am suspicious of any Stuttgart-directed cutting in this
> crucial area.
>
> Ordering parts suppliers to cut prices 5% is another mistake. Suppliers
have
> already made big concessions to Chrysler, and are furious with the new
> demands. Some, in fact, are saying they won't do it, even if they lose
> business.
>
> Let me say two things:
>
> Chrysler made huge profits when it worked with suppliers. Under former
> Chrysler President Tom Stallkamp the company achieved remarkable cost
> reduction through cooperation. This was one of the great strengths of
> Chrysler when it was independent. But the Germans had Stallkamp fired--he
> talked back too much--and now they are reverting to the old tried, tested
> and unsuccessful methods of other carmakers.
>
> To my knowledge DaimlerChrysler isn't making brutal demands like this--at
> least publicly--to parts companies in Europe. For example, the Smart car,
> made by Daimler in Europe, is a disaster losing $500 million per year the
> last time anyone gave out figures. Daimler did not autocratically cut the
> prices it was paying German and French parts makers by 5%. Nor are the
> Germans shutting the money-losing Smart factory or laying off large
numbers
> of employees.
>
> Meanwhile, the bosses in Stuttgart want to lay off, retire or fire
thousands
> of U.S. white-collar employees. If the United Auto Workers are interested
in
> organizing the white-collar workers of Chrysler, now is the moment.
>
> What about the idea of combining designs or parts with Mitsubishi to save
> money? Mitsubishi is presently an unsuccessful company. Chrysler outsells
> Mitsubishi by nine-to-one in the U.S. Yes, the two companies have some
> cooperative ventures, but they are not particularly successful and there
are
> few reasons to think that larger cooperation, involving angry Americans
and
> dumbfounded Japanese, would work.
>
> What about sharing with Mercedes? Most of Mercedes' cars sticker for
$50,000
> or more. Chrysler's sweet spot is the $20,000 range. If someone's got a
> little trick to save a few pennies on low-visibility components, fine. But
> it wouldn't pay to ship parts from Germany to the U.S., and Mercedes'
> designs and parts are expensive. That's why its cars cost so much. So how
> much can you save? And the company runs the terrible risk of diluting the
> Mercedes name.
>
> What would I do?
>
> Yes, new product plans should be reviewed. That's always wise, but it
should
> be done by people who know a lot about the American market. The goal
should
> be to offer the best, most creative cars and trucks at the lowest cost.
I'd
> also mend fences with the suppliers, and go back to the old strategy of
> cooperating and sharing the savings.
>
> What about staffing? Chrysler was never overstaffed when I worked in
> Detroit. Somehow I doubt that this has changed. Yes, there might be a
little
> fat, but the ugliest fat I've seen is the German plan to crate an extra
> headquarters for themselves in New York City. Why not cut that one, boys?
>
> On the product front I'd put cooperative ventures with Mitsubishi on the
> back burner and be very careful about putting Mercedes components or
> production technology onto Chrysler platforms. A Mercedes S class sedan
and
> a Dodge Neon shouldn't have anything in common.
>
> A final parting thought on Chrysler's present products: Stop worrying. The
> new minivan is a winner. If it gets the first-rate marketing and
advertising
> it needs, sales will take off in the spring, a traditionally good time for
> such vehicles. The same with the new Chrysler Sebring convertible, which
is
> just moving to dealers. And the launch of the new Jeep Liberty--which
looks
> like a big winner--is crucial, so every effort should be made to do it
> right.
>
> As I see it, Chrysler has three big problems: product development costs,
> rebate-based marketing and an ongoing need for new products. Getting these
> three right is hard work. Panic won't do the trick.
>
> --------------------------------------
> Steven St.Laurent
> 2000 Dakota Hemi 4.7 (WRECKED!!)
> 2000 Ford Roush Mustang Stage III - TT version (sold)
> 1999 Chebby (gone in 2003)
> 1993 Tracker (still going-going-going...)
> --------------------------------
> Aspiring for now:
> 2003 Dakota Hemi 5.7 or a V-10 mod
> 2003/4 Viper GTS-R
>
>
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